Ventress Enterprises

Changing to Meet the Market

The following article is proof of the fact that, no matter how big your business is and no matter how high your revenue, or how large your advertising campaign may be, no business is immune to having to continuously change and grow in order to meet market demands and keep your customers happy and coming back.

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Last Man Standing

With the closure of Circuit City earlier this year — and Comp USA before that — Best Buy is the only remaining national electronics chain. On its face, that would seem like a good thing for the company. But analysts argue that Best Buy has inherited a lump of coal.

Even in good times, electronics retailing can be a brutally tough business, littered with failures that were unable to survive thin profit margins, ever-falling prices, feast-and-famine product cycles and, more recently, major price pressure from Internet retailers.

Best Buy is “the last man standing, and it’s a good company,” said Andy Hargreaves, an analyst with Pacific Crest Securities. But “consumer electronics is one of the worst businesses in the world to be in.”  Brian J. Dunn, Best Buy’s new chief executive, disputed that characterization.

At the same time, Mr. Dunn, who started as a store salesman at Best Buy in 1985, plans to keep renovating. He acknowledges that being the last remaining chain won’t ensure success.

Mr. Dunn said that Best Buy must account for changing tastes, like the shift away from CDs and DVDs, which have for years been a crucial generator of foot traffic in Best Buy stores. To cope, Mr. Dunn said, Best Buy was in the process of moving those products out of the center of its stores and focusing eyes and attention on fast-growing product areas, like mobile phones and low-cost laptops.

And Mr. Dunn said he wanted to create an atmosphere where consumers were attracted not just to products but also to services that help them master fast-changing technology and configure and connect devices.

“The center of the store will become an expression of the way people connect — connect with movies, music, pictures, to each other — all the things that matter,” he said.

Read the entire story @ NYTimes.com/business

Tags: article, business, marketing, opinion